Amazon is throwing brick-and-mortar book stores a lifeline by providing them with a 10 percent discount on all Kindle books sold on devices purchased in their stores. The news arrives as retail and used book sellers face a decline in physical sales as consumers scoop up tablets, smartphones and e-readers to consume books in digital form.
Even more, now that the government has wrangled the publishers into providing fair, competitive prices, retailers are facing even more declining sales. Previously, e-books soared up into the $15 realm thanks to an agreement between Apple and five publishers. All five have settled out of court, while Apple decided to duke it out with the Justice Department over the summer. Prices are now beginning to drop once again.
Amazon's new program is called Amazon Source, and allows independent bookstores and other retailers to sell Kindle devices and accessories, actually making money in the process. The program also provides retailers with an option of receiving 10 percent of every Kindle book purchased on Kindle devices sold by the bookstore for the first two years after a customer buys a device.
"We believe that retailers, online or offline, small or large, should be striving to offer customers what they want—and many customers want to read both digital and print books," said Russ Grandinetti, Vice President, Amazon Kindle. "For many years, bookstores have successfully sold print books on Amazon—now Amazon Source extends this opportunity to digital. With Amazon Source, customers don't have to choose between e-books and their favorite neighborhood bookstore—they can have both."
Amazon Source provides two programs: Bookseller and General Retailer. Booksellers can buy Kindle devices at a 6 percent discount and Kindle accessories at a 35 percent discount, while receiving a 10 percent commission on the price of every e-book purchased from the sold Kindle device. The General Retailer program allows stores to buy Kindle devices at 9 percent off the retail price and Kindle accessories at 35 percent off the retail price. This program does not provide a commission.
"To qualify, you must operate a physical retail store (at this time, online sales are not permitted through this program) and be able to provide state resale exemption certificates for each state in which you have a store," reads Amazon's eligibility rules. "Signing up takes just a few minutes, and if you meet these basic requirements we'll activate your account within two business days."
Amazon Source is based on the deal that Amazon made with Waterstones in the UK back in 2012. The first order from Amazon Source is worry-free for retailers, Amazon promised. If a retailer decides they no longer want to sell Kindle, Amazon will buy back the inventory for up to six months after their first order with no questions asked.
Unfortunately, not every state is eligible for this program including Alabama, North Carolina, Texas, Vermont and a number of others listed here.